Tag Archives: John Lewis

Tesco’s plans to close 43 ‘Express’, ‘Home Plus’, ‘Metro’ and ‘Superstores’ by mid-April has been well publicised, as has their proposal to scrap another 49 NEW stores planned for the UK. The Company has also scrapped plans for 13 new stores in Hungary, but it’s not clear whether the sites will be ‘land banked’ as it’s called or sold-off, and if so on what terms.

He seemed oblivious to the relief of independent retailers in Bilston Market Hall and on the High Street and those locals who’ve stared at this derelict site for the last 14 years

The announcements provoked outcry amongst MP’s protesting at the effect on their constituencies. One of the most strident was Pat McFadden MP (Labour, Wolverhampton South East) indignant at Tesco’s decision to scrap development of the former Royal Hospital site in Wolverhampton. He seemed oblivious to the relief of independent retailers in Bilston Market Hall and on the High Street and those locals who’ve stared at this derelict site for the last 14 years. He proclaimed the news from Tesco was a ‘betrayal’ and proved the Company ‘could not be trusted’. No-one can accuse Pat of jumping to conclusions – he’d taken 14 years to work that out. Nor did the news have the earthshaking effect he’d hoped for amongst dispirited locals. No member of the Hungarian National Assembly was available for comment.

Provided your pockets are deep enough there is nothing to prevent you from buying premises ‘just in case’ and very little to prevent you from leaving it derelict thereafter

But Pat’s comments DID highlight a major flaw in the UK town planning system – how all supermarkets (not just Tesco) ‘land bank’ future development sites, then leave them derelict. This practice has been criticised by the Competition Commission as an underhand means of preventing competitors from expanding into their business – which is of course exactly the intention. Provided your pockets are deep enough there is nothing to prevent you from buying premises ‘just in case’ and very little to prevent you from leaving it derelict thereafter. Effective legislation to prevent land banking does not exist so supermarkets and housebuilders continue to buy-up sites as soon as a new Local Plan is released which zones areas for future development. As the Commission has pointed out, if a developer can snap them up quickly and on the cheap – often by an initial payment plus top-up bonus once it is built-out – then that effectively blocks the competition. Between purchase and build-out the planning authority is largely powerless to prevent the site being left derelict and has to tell anyone applying for a similar use: ‘Sorry – there’s another site already allocated for that use’. That’s why draft Local Plans generate so much interest from developers.

There has been talk about forcing developers to relinquish land-banked sites under threat of Compulsory Purchase Order, or forcing them to put the land to ‘beneficial use’ – but who will pay for it?

This problem has not been helped by the Dept. for Communities and Local Government (DCLG’s) shiny new National Planning Policy Framework (NPPF) introduced in 2012. Secretary of State for Communities and Local Government, Eric Pickles MP (Conservative, Brentwood & Ongar) has been widely-criticised for replacing 1500 pages of national planning policy built-up over 40 years with 50 pages devised in 40 months. The new slimline NPPF is accused of being far too pro-development and lacking a means to counter land-banking – frustrating local planning authority efforts to phase development to a rational programme. There has been talk about forcing developers to relinquish land-banked sites under threat of Compulsory Purchase Order, or forcing them to put the land to ‘beneficial use’ – but who will pay for it? Not local government for sure. To compound the problem local planning authorities are under pressure to meet DCLG targets for more homes for our expanding population. Landbanking means green fields are often built-out It will be interesting to see whether Tesco hold onto or sell-off their cancelled development sites. Councillor Roger Lawrence, leader of Wolverhampton City Council, said: ‘The Council has done everything it its power to support Tesco to proceed with their plans, and I and senior council officers will now be seeking urgent discussion with Tesco about how to take forward the development of this key gateway site.’ Well, unless Wolverhampton CC make some outrageously expensive taxpayer-funded concession there’s not a lot they can do to force Tesco into action. And if Tesco do sell-off then you can bet they’ll slap a restrictive covenant on the title deeds to frustrate any competitor from acquiring the site in the future.

A 23% drop in Waitrose operating profits has meant bonuses have been cut for the second consecutive year

Another group which is far from happy are the 94,000 staff who own John Lewis and Waitrose. Traditionally some 45 – 50% of trading profits have been paid-out as bonuses to the ‘partners’ each year but a 23% drop in Waitrose operating profits has meant bonuses have been cut for the second consecutive year, from 15% to 11% of annual salary. This was despite the upmarket grocer increasing like-for-like sales by 1.4% and gaining market share against its rivals. The boss of Waitrose, Mark Price, said the Company is battling against shoppers ‘moving away from a single, weekly out-of-town shop to multiple smaller purchases from convenience stores and online’.

Tesco is trying to rebuild its fraught relationship with suppliers.

Finally, after it’s £260 million false-accounting scandal (booking ‘supplier discounts’ before receipt) Tesco is trying to rebuild its fraught relationship with suppliers. The Company is waving the magic wand of a friendly online Tesco Supplier Network to help 5,000 suppliers communicate with their Buyers and each other – complaints included. Given their rough treatment of suppliers in the past the rumour has it few are likely to let bygones be bygones. The magic wand is seen as a big stick in disguise.

 

As Christmas fades into customary memories of short-term celebration and long-term debt, I hear from many market sources that pre-Christmas trading within our markets was poor and below the previous year’s results. Common comments include ‘ we don’t understand, we did the same as last year’ but it would appear the shoppers didn’t come, at least, not in the numbers hoped for.

Black Friday sucked vast amounts of cash out of the retail economy at much reduced margins

In a European economy on the brink of deflation where, retail supply outstrips insufficient consumer demand, the narrow margins of retailing success is to extract Christmas shopper spending at the right time and it appears the 2014 Black Friday sucked vast amounts of cash out of the retail economy at much reduced margins. It surprised even the largest retailers and delivery companies and unfortunately a few accident and emergency wards.

The Genie is out of the bottle

Andy Street, managing director of John Lewis was stated as saying: ‘I personally hope we move back in future to a more normal pattern where sales are smoothed over the Christmas period’. Sorry Mr. Street but it ain’t never gonna happen! The Genie is out of the bottle and with the medium term economic forecast showing much of the same, like it or not we will endure many more annual black Friday’s for years to come.

market traders will face very difficult times this first quarter of 2015

As a market industry, we have always relied on solid pre-Christmas trade to see us through the ‘kipper’ season and I am fearful of the number of market traders who will face very difficult times this first quarter of 2015, without a few thousand in the bank from Christmas sales.

2015 Black Friday will be bigger and more damaging than last year

Be under no illusion, 2015 Black Friday will be bigger and more damaging than last year and the market industry needs to prepare a marketing strategy to divert shoppers’ spend back to the High Street. It will need to be potent and before Friday 27th November, 2015. If every market trader business contributed £20 towards to ‘Mid November Market Madness’ a fund in excess of £1m could be raised for a national campaign, now there’s an idea!

News-covered outdoor market

Two years of uncertainty about the future of Preston Market ended on 8th May when Council leader Peter Rankin and Jonathan Owen of Quarterbridge gave Traders a thumbs-up for the future.

Decision to demolish the 1970’s Market Hall and Car Park after structural investigations confirmed rising costs made it impractical to maintain the crumbling concrete building.

Last year the Council commissioned Market consultants Quarterbridge to research and produce recommendations for their Market operation following their decision to demolish the 1970’s Market Hall and Car Park after structural investigations confirmed rising costs made it impractical to maintain the crumbling concrete building. A packed meeting of Traders from both the Market Hall and adjacent Covered Market heard Councillor Rankin confirm the Council was committed to the Market but now had to consider the options. He said:

‘Despite limited resources, the Council remains committed to providing a modern, fit for purpose Market delivering a low cost, fresh, healthy food offer in the City centre.’

The Tithebarn project involved converting the Victorian open-sided Covered Market into a new Market Hall but this was abandoned in November 2011 when the anchor tenant, John Lewis opted for Hammersons’ Eastgate development in Leeds instead.

Traders welcomed his statement which came after several years of uncertainty about the future. Some 60 businesses trade indoors and on the Covered Market, but following the withdrawal of developers Grosvenor and LendLease from the proposed Tithebarn central area regeneration project it was unclear whether a replacement would ever be constructed. The Tithebarn project involved converting the Victorian open-sided Covered Market into a new Market Hall but this was abandoned in November 2011 when the anchor tenant, John Lewis opted for Hammersons’ Eastgate development in Leeds instead. Since then Preston Council has been exploring ways to replace the Market Hall and re-start the central area regeneration, with most options involving relocating of the Market Hall and releasing it’s site for a mixed-use retail and leisure development.

The report was presented by Quarterbridge Director Jonathan Owen who confirmed the current Indoor, Covered and Carboot operation trades under capacity but still has a sustainable future within a catchment of 250,000.

Traders heard how most of the relocation options are under Council control and not subject to the type of lease which forced the recent closure of Lancaster Market Hall. The report was supported by a retail catchment analysis which confirmed how the mixture of Indoor, Covered and Carboot operations remains a big attraction to shoppers, with the potential to develop it further.

The Quarterbridge recommendations include:

  • Replacing the Market Hall with a smaller modernised version – sized to maintain the fresh food offer but ensure 100% occupancy. The size to be dependent on a detailed study of Traders space requirements and the relocation options.
  • Maintaining continuity of trade by building the new Market Hall before closing the existing building.
  • Incorporating an Anchor footfall attraction and maintaining the winning combination of Indoor, Covered and Carboot.
  • Including a Shoppers’ carpark in the redeveloped Market Hall site.
  • Intensifying use of the Market asset by staging events like Farmers Marts whilst introducing business support through the Federation of Small Businesses.

Jonathan Owen said: ‘Our research clearly confirms a varied Market operation is sustainable. Our report represents shows the options the Council need to consider to take things forward’.

Responding, Councillor Rankin said: ‘We welcome the Quarterbridge findings and will now consider all the recommendations in detail before taking any further decisions. We regard the Markets Quarter as the means to kick-start City centre regeneration and are determined to make the best possible use of the Covered Market canopies which are a huge asset for the City’.

The full report can be viewed at www.preston.gov.uk/marketsreport